IBBI Circular for Insolvency professional not to outsource his responsibilities

Insolvency and Bankruptcy Board of India (IBBI) has issued a circular for putting restriction on outsourcing of any duties and responsibilities under the Insolvency and Bankruptcy Code, 2016. The IBBI has observed that some insolvency professionals are advising the prospective resolution applicants to submit a certificate from another person to the effect that they are eligible to be resolution applicants. This requirement amounts to outsourcing responsibilities of an insolvency professional to another person. Further, this leads to cost escalation for the resolution applicant and delays submission of resolution plans. The IBBI Code read with regulations does not envisage such a certification from a third person.

Thus, IBBI has directed that an insolvency resolution professional shall not outsource any of his duties and responsibilities under the Code.